Remember the Ship which had blocked the Suez Canal & for a weeks time the complete Trade between Europe and Asia was blocked which used to pass through this historic marvel in Egypt, estimated close to 350+ Ships summing up to $10 Billion worth of goods in a span of just 6 Days was hampered.
The EverGiven Ship is an absolutely amazing combination of Globalization of Economies. The company which owns the ship is a Japanese company, the operator of the ship is a Taiwanese company, the Technical Management of the Vessel was being done by a German Company & the ship was registered in the Country of Panama and the crew onboard this vessel was Indian. It was carrying cargo from Malaysia to the Netherlands. Peaks of international integration No?
With all the news coverage this incident has garnered across the world media & also the banters with various memes on the Social Media, now this incident has taken an altogether a different turn, The Egyptian Suez Canal Authority (SCA) which manages the Maritime transport for the Suez Canal (which earns more than $5 Bn in tolls) has seized this ship & is claiming close to $1 Bn in fines from the owners of this ship in pursuant to disrupting traffic & trade.
More than $3 billion of liability coverage is in place for the owner of the grounded container ship provided by a UK-based Insurer Mutual UK P&I Club. The SCA had demanded the claims to the owners which they are trying to negotiate, the company said a “generous offer” was made to the SCA to settle their claim on Monday, without elaborating on the sum. “We are disappointed by the SCA’s subsequent decision to arrest the vessel today,” the company’s statement added.
As the investigation into the grounding of the Ever Given in the Suez Canal begins, the vessel’s Japanese owner, Shoe Kisen, has declared General Average. The law of general average is a principle of maritime law whereby all stakeholders in a sea venture proportionally share any losses resulting from a voluntary sacrifice of part of the ship or cargo to save the whole in an emergency. This law has its origins late back in the year 800 B.C. Stange No?
While there is no reported damage to the cargo, and that to the vessel appeared to be minimal, the cost of the salvage operation, which ultimately required 11 tugs and two dredgers, as well as possible compensation claims from a variety of interests such as the Suez Canal Authority or shipping companies caught up in the backlog, could amount to a sizeable bill.
The problem for cargo interests, according to insurance sources, is that the cost of the casualty to its owners is likely to take some time to determine if it involves claims from other parties, which means the adjustors will remain unable to fix the level of the general average and salvage securities. Evergreen said it had begun to look at other ways to free cargo trapped on board, adding: “In order to lift the arrest order as soon as possible, Evergreen is urging all concerned parties to facilitate a settlement agreement to be reached.
So all in all the Bosses of EverGiven don’t seem too worried and have figured out a way to split the bill with insurers. These are very articulate times where the Insurance package & a strange law has come in force together.
Posted by @akshayrote